You need a legally binding agreement when looking for a property to set up your business. This agreement between you and your potential landlord is called a commercial lease and is essential. Some of its advantages are cheaper compared to buying and tax benefits. In addition, the assigned ability and economic terms of the lease can come in handy when you want to sell the business. However, you need to get an excellent deal to focus on your business. So, how do you get a good commercial lease deal? The best way is by using the following valuable tips in your commercial lease planning.
Evaluate your future business needs
Firstly, you should evaluate your future business needs before starting negotiations. These needs can include expected future space for growth and outer attributes like parking or accessibility. This evaluation will enable you to determine your budget in preparation for the negotiation. In addition, it will guide you on what type of space you need.
Hire a lawyer
Legal representatives are essential when drafting and negotiating the commercial lease agreement. Therefore, you should hire a specialist like a commercial lease attorney who understands the ins and outs of such agreements. Using a general lawyer might be costly due to hidden costs and unfavorable clauses that can stifle your business.
Ascertain the square footage
As with any deal, you shouldn’t sign a lease agreement until you confirm if you will get what you are paying for. Space measurements can be distorted due to modifications that will shortchange you. Remember that you are leasing usable space, not common areas, which some property managers include in the square footage. Therefore, you need to confirm it with the help of a professional appraiser.
Compare rents in the area
It’s also essential to research and compare the market rates in the area you intend to lease from. You can reach out to a commercial realtor to provide you with up-to-date market lease rates. The market rates will help you when comparing with your landlord’s asking price and help you when negotiating for lower rates. Doing this will help you negotiate better security deposits and conditions for a refund.
Understand the available lease options
There are five commercial leases: net lease, double net lease, triple net lease, gross rent lease, and percentage lease. The cost of each type of lease varies depending on what it covers. For instance, in the gross rent lease, you will equally split the costs related to the property with the landlord. These costs include rent and incidentals like structural repair. It would be best to go through the options with your attorney and choose the most financially favorable.
Review termination conditions
Sometimes push comes to shove, which calls for contract termination. You need to carefully read the terms and identify if there is a clause that allows you to cure a default before vacating. It would be best if you go through it with a legal representative like a commercial lease attorney to identify any clause that may trouble you in the future.
Leasing space for your business is an integral part of growth. However, you need a good lease deal for you to operate peacefully. Using the tips in this article will help you negotiate a better commercial lease deal.